Cost Efficiency of Portuguese Hotels in the Algarve: A Comparative Analysis Using Mathematical and Econometric Approaches

Ricardo Oliveira, Maria Isabel Pedro and Rc Marques ()

Tourism Economics, 2014, vol. 20, issue 4, 797-812

Abstract: A sample of 28 prestige hotels on the Algarve (Portugal) is analysed to compare the results of the data envelopment analysis and stochastic frontier approach techniques in order to measure cost, allocative and technical efficiencies. The results suggest that efficiencies are similar when they are calculated by these two models. Companies with five-star hotels, hotels with golf courses and owners of only one hotel have higher efficiency levels than their peers. One explanation for this evidence is that these models express themselves through cost or production technologies, allowing them a better fit.

Keywords: mathematical and econometric approaches; data envelopment analysis; stochastic frontier analysis; hotel efficiency; Algarve (search for similar items in EconPapers)
Date: 2014
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Citations: View citations in EconPapers (5)

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Persistent link: https://EconPapers.repec.org/RePEc:sae:toueco:v:20:y:2014:i:4:p:797-812

DOI: 10.5367/te.2013.0309

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